Nvidia is the undisputed winner of trade in artificial intelligence, as a leader in creating chips and network infrastructure that AI solutions Power AI. However, there are many competitors who try to go into the promotion. After all, the potential market for AI will be so large that only a small connection with the market can send a share.
Two shares that are sandwiched with the AI trade and that make chips and other AI infrastructure are Widthcom(Nasdaq: AVGO) And Advanced micro devices(Nasdaq: AMD). Broadcom has performed well, with its stock almost 86% in the past year. In the meantime, AMD has struggled, with its stock almost 36%.
Wall Street analysts currently expect that one of these companies will grow income faster in 2025, but the others will perform better in stock price for the next 12 to 18 months. Let’s look.
Although Nvidia has made the name by dominating the wide chip market, Broadcom has focused on making adapted chips for some of the big technical players such as such as such as Alphabet” AmazonAnd Microsoft.
After the rise of Deepseek, a Chinese company that claims to have developed an AI chatbot against a fraction of the costs of competitors, many think that adapted chips will be ahead of the path, which is good for Broadcom. Others also suspect that Broadcom has locked up new customers such as OpenAi, the creator of Chatgpt. The company now has a market capitalization of $ 1 trillion covered
For the financial year, only $ 1.27 profit per share ended in November, but the majority of this was due to the depreciation of intangible assets with regard to the acquisition of VMware by the company at the end of 2023. On an operational basis, the diluted income at $ 4.86. Wall Street analysts on average expect the company to grow diluted income to $ 4.01 in Fiscal 2025 and generate operational diluted income of $ 6.35, according to data provided by visible Alfa.
During the last profit call from the company, the management bullishness on the adapted chip market and thinks the company will play a role while hyper-scalers roll out their own adapted AI speeds or chips. Broadcom quoted his three hyperscaler customers and said that their journeys together represent an AI -usable addressable market (SAM) for adapted chips and network in the $ 60 billion to $ 90 billion in tax 2027.
The shares of Broadcom have performed well and analysts think that it is being reasonably appreciated at the moment. Although no analysts say that they have spent research reports on the company according to Tipranks in the past three months. The average price target implies a very minimal advantage. Analysts do not seem to be a bearish at all, so it can be a call for valuation to catch the stock. Broadcom is currently being traded with almost 37 times forward income.
Being in the AI game is a major problem, so investors often discuss advanced micro devices. The biggest problem with AMD, however, is that it has to compete with Nvidia, a company that generates gross profit margins in the mid -70s percentile and extreme price strength. According to experts, AMD produces cheaper chips than Nvidia, but they are only about 80% as powerful.
Nevertheless, Wall Street analysts currently expect the profit to grow well this year – from $ 1.00 in 2024 to $ 2.47 in 2025, according to visible Alpha. On an operational basis, analysts expect the profit to grow from $ 3.31 to $ 4.62. However, we will see how long these will last after AMD’s recent income has disappointed the market. The company defeated estimates and even provided income guidance before consensus.
But the turnover in the company’s data centers segment came lighter than expected, which has disappointed investors, considering how much the market is growing. After income, some analysts expressed their concern about the prospects for the growth of AMD’s AI activities.
Despite weaker figures from data centers, analysts are still largely bullish in the stock. According to Tipranks, a total of 36 analysts have issued research reports on the company in the past three months. Of these, 24 analysts assess the share that a buy, 11 says to keep, and says only one to sell. The average price target suggests almost 33% an increase in current levels (from 11 February).
The discrepancy between AMD and Broadcom seems to be based on appreciation. While Broadcom trades 37 times income, AMD acts about 23 times. In the short term, AMD can have more room to run on every change in sentiment. However, Broadcom seems to be better positioned to take advantage of the current trends in the AI market.
Consider this before you buy shares in Broadcom:
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*Stock Advisor Return on February 7, 2025
John Mackey, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the board of directors of the Motley Fool. Suzanne Frey, a director of Alphabet, is a member of the board of directors of the Motley Fool. Bram Berkowitz has no position in one of the aforementioned shares. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Microsoft and Nvidia. The Motley Fool recommends Broadcom and recommends the following options: Lang January 2026 $ 395 calls on Microsoft and short January 2026 $ 405 calls on Microsoft. The Motley Fool has a disclosure policy.
Broadcom vs. Advanced Micro Devices: Wall Street sees one much faster profit growth, but thinks the other shares were originally published by The Motley Fool
